Jupiter Real Estate 
Market Sees Sales Up

There were 86 home sales in the Jupiter market over the last 30 days, while coming close to the 99.4 monthly average for the last 12 months. In comparison, nearby West Palm Beach had 134 sales in the same time frame, the most of all neighboring cities. The median sales price dropped to $308,500 over the latest reporting period for Jupiter, down from $310,000. Despite the uptick in sales, there are still seven months of inventory left to work through, meaning Jupiter is still a definite buyer's market.
 

Biscayne Bank has gained strength from new real estate deals. In May, Biscayne reported a 12 percent hike in net income fueled largely by loan growth. Its loan portfolio grew 32 percent to $326 million at the end of March compared to $246 million a year earlier. And that growth pushed net interest income up 34 percent year over year to reach $3.62 million.
"We are seeing strong demand in our home market of Miami-Dade County for both residential and commercial real estate loans," CEO Lorie Yarchin said in a statement. "In the coming quarters we hope to continue to be able to capitalize on the demand we see for quality real estate loans." Community banks also appear poised to benefit from what might be a unique South Florida trend.


Condo developers are relying less on large construction loans with many Latin American buyers willing to pay hefty deposits of up to 50 percent. That influx of cash often leaves developers needing to borrow less—if anything—to complete construction.
And that's prompting large lenders to implement a minimum-draw requirement to guarantee they'll generate enough income on each deal. But for smaller banks, demand for smaller construction loans could be a boom.
At Miami's Apollo Bank, the lending limit is $11 million and typical commercial loans range from $3 million to $5 million. "We always had an appetite for quality real estate loans, and we still have it,"said Mahesh Pattabhiraman, Apollo's senior vice president and chief lending officer.
"There is obviously a willingness. We're in a real estate market. If you're in Miami you have to be part of commercial real estate lending." The bank's lending grew 25 percent this year, with real estate loans driving about 80 percent of that growth. And commercial real   estate accounts for about half of its $321 million loan portfolio.
This year Apollo raised $22 million from investors and acquired First Bank of Miami in August to become one of the largest Florida-based banks. It joined a slew of community banks growing through acquisitions as part of a strategy to absorb compliance costs in a post-recession era.
Bank of Coral Gables, for instance, in January announced plans to merge with Elk Grove Village, Ill.-based First American Bank and become part of the $3.4 billion organization.
And in October, Home Bank shares, owner of Centennial Bank, completed its $33 million acquisition of Broward Bank of Commerce's parent, Broward
Financial Holdings Inc.

"There are fewer banks because of the financial crisis, but smaller banks have had to get bigger because of fixed compliance costs," said Robert Elias, a Miami
 attorney who represents several area banks. "There are fewer of them, but those banks are bigger, stronger, healthier and able to do more lending."

Still Conservative


Although they're more willing to lend, banks remain conservative.The larger community banks face a new challenge under the Dodd-Frank Act when they reach $10 billion in assets. The law imposes increased scrutiny, new rules and annual stress tests so banks can prove they have the resources to survive financial hardship.


That's what's happened with First Bank Florida, an opportunistic lender open to financing construction and several classes of commercial real estate, but restricted by an uncertain regulatory climate because of its $12 billion in assets.
"We need to be more judicious and make sure all the loans we do are conservative,"Garcia-Velez said."The increased scrutiny makes it more burdensome, and in the long run this will play out with higher loan costs for consumers."



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